In August, SCAN Health Plan announced a partnership with Costco Wholesale Corp. to sell insurance products for older adults.
Sound familiar? Costco is not the first retailer to partner with a Medicare Advantage insurer.
Kroger has worked with Select Health and Priority Health on co-branded MA plans in 2023 and 2024. Websites outlining Select Health and Kroger’s co-branded plan remain active in 2026, whereas a spokesperson for Priority Health told Becker’s that its Kroger plan is no longer in existence. Alignment Health and Walgreens got in on co-branded MA plans in 2024, as well.
SCAN and Costco made a splash with their recent news, landing coverage in The Wall Street Journal and on the “Today” show. However, another co-branded MA plan — involving the country’s largest healthcare company and big-box retailer, UnitedHealthcare and Walmart, respectively — quickly fell apart. If those two companies could not keep their plan alive, what does it actually take to run a successful one?
UnitedHealthcare and Walmart
Retail giant Walmart entered the MA market through a partnership with UnitedHealthcare, first announced in 2022. The companies offered “UnitedHealthcare Medicare Advantage Walmart Flex” in Georgia.
The co-branded MA plan stemmed from a 10-year partnership between UnitedHealth Group and Walmart, focused on a value-based care model for MA members.
“UnitedHealth Group and Walmart share a deep commitment to high-quality and affordable primary care led services that address all of a patient’s health needs in ways that are convenient for them and improve health outcomes,” former UnitedHealth Group CEO Andrew Witty said at the time.
However, Walmart’s and UnitedHealth’s ambitious plans came to a halt less than two years after they were originally amplified.
To recap: Walmart launched Walmart Health centers in 2019, complete with a suite of virtual care services and eventually 51 centers across five states. Five years later, though, the company decided to close Walmart Health due to a “challenging reimbursement environment” and steeper operating costs, resulting in profitability issues. Walmart pharmacies and vision centers were not affected by the closure, but the decision to wind down the MA plan came amid the news.
The move could have come as a surprise: Walmart had been preparing to grow its healthcare footprint with more clinics in 2024. A 2023 news release said 90% of the U.S. population is based within 10 miles of a Walmart, signaling a major opportunity for healthcare accessibility.
At the same time, health system leaders told Becker’s that Walmart’s expansive healthcare initiatives faced the same challenges hospitals had been reckoning with — reimbursement, inflation with supply chain and operating costs, and more expensive workforces.
While Optum had played a crucial role in the partnership thanks to its analytics and decision-support tools, UnitedHealth separately shut down its telehealth business, Optum Virtual Care, just days before the Walmart Health closure. The announcement followed a review of the company’s capabilities and services.
SCAN and Costco
SCAN and Costco are now working on insurance products together, releasing them in the coming years. To begin, the companies will sell joint MA products in two states, as well as a Medicare supplement plan in a third state, the Journal reported. Benefits, markets and timing details are pending regulatory approval, SCAN CEO Sachin Jain, MD, said on LinkedIn.
“Costco has built something exceedingly rare: trust at scale,” Dr. Jain said. “Its members believe that if Costco puts its name on something, it has been carefully vetted for quality and value. That trust was earned one decision and one member experience at a time.”
He called Costco “one of the most trusted consumer brands in America,” adding that SCAN is leaning into MA despite health plan retreats. Medical costs, federal cost-containment strategies and star ratings tensions have contributed to a strained MA landscape.
However, unlike UnitedHealth, SCAN’s insurance business focuses exclusively on Medicare offerings. SCAN Health Plan has nearly 460,000 members spanning California, Arizona, Nevada, Texas, New Mexico and Washington.
SCAN and Costco had not been total strangers leading up to their co-branded plan. The companies announced a rewards program to incentivize members’ healthy behaviors in late 2025. The insurer also permitted over-the-counter and flexible spending benefits to be used at Costco stores in Washington.
Senthu Arumugam, SCAN’s chief commercial officer, previously told Becker’s that about 75% of members shop at Costco. He also laid out three pillars to inform retailer collaborations.
“As people think about retail partnerships, what’s important to us is that we’re working with retailers that are just laser-focused on value, experience and quality,” Mr. Arumugam said.
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